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White Knight For Flailing Knight: WSJ Reports Potential Bailout Merger In The Works

Tyler Durden's picture





 

Earlier we said that Knight better sell itself today or it's lights out. Sure enough, here come the rumors via the WSJ:

Knight Capital is in talks with Virtu Financial, a big player in high-speed trading and "designated market maker" on the NYSE, about a potential merger or infusion of capital

And more from Dow Jones:

  • WSJ: Knight in Discussions About Possible Deal With Electronic-Trading Firm Virtu — Sources
  • WSJ: Talks Also Involve Silver Lake Partners, An Investor in Virtu — Sources
  • WSJ: Talks in Early Stages and No Deal Guaranteed — Sources
  • WSJ: Knight Also in Talks With Other Potential Funders, Partners — Sources

Will it happen? Maybe. Although we doubt it - why pay for equity value when one can pick up the functioning assets in a Chapter 363 asset sale which also sticks the creditors with all the crappy assets? Just like Barclays did with Lehman for millipennies on the dollar.

 


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Thu, 08/02/2012 - 12:39 | Link to Comment monkeyboy
monkeyboy's picture

Bonus time!!!

Thu, 08/02/2012 - 12:52 | Link to Comment RockyRacoon
RockyRacoon's picture

No doubt, we, the taxpayer, will back this "merger".

Virtu ?  What?  These guys can't even spell let alone justify the name.  The name is not even catchy, it just makes me wanna gag.

There hasn't been "virtue" on Wall Street in long time.

Thu, 08/02/2012 - 14:42 | Link to Comment El Oregonian
El Oregonian's picture

Virtu-Knight=VK-ULTRA?

Thu, 08/02/2012 - 14:18 | Link to Comment AcidRastaHead
AcidRastaHead's picture

Bonus time for some.  Millipenny time for others.

Thu, 08/02/2012 - 12:39 | Link to Comment fightthepower
fightthepower's picture

Fuck you Bernanke!

Thu, 08/02/2012 - 12:56 | Link to Comment Brother Sebastian
Brother Sebastian's picture

Before you criticize Benny-boy, you should walk a mile in his shoes.  That way, when you criticize him, you're a mile away and you have his shoes.

Thu, 08/02/2012 - 13:05 | Link to Comment Muppet of the U...
Muppet of the Universe's picture

Don't fuck Benny boy.  He might be the only person left to bail-out the futures market if these futures accounts dont get transfered to a liquid clearing firm.

Thu, 08/02/2012 - 16:43 | Link to Comment OneTinSoldier66
OneTinSoldier66's picture

Thank you Brother Sebastian, that was great!

Thu, 08/02/2012 - 12:40 | Link to Comment The Axe
The Axe's picture

Kenny pasternack   has wallet open......5 dollar bid soon....

Thu, 08/02/2012 - 12:40 | Link to Comment buzzsaw99
buzzsaw99's picture

then they can play ping pong? great.

Thu, 08/02/2012 - 12:41 | Link to Comment malikai
malikai's picture

Should be good for a little pop in their share price as the momos and headline reading bots catch knives.

Thu, 08/02/2012 - 12:42 | Link to Comment Piranhanoia
Piranhanoia's picture

Smart money buying a turkey that is so dead only the feathers have any value.

Thu, 08/02/2012 - 12:43 | Link to Comment mrdenis
mrdenis's picture

Captain America saves the day ...

Thu, 08/02/2012 - 12:48 | Link to Comment phalfa5
phalfa5's picture

All your base are belong to us

 

www.youtube.com/watch?v=qltugh-fFgg

Thu, 08/02/2012 - 12:43 | Link to Comment emersonreturn
emersonreturn's picture

tyler, you invariably call it with uncanny accuracy, it's fun watching the results come in time and again.

Thu, 08/02/2012 - 12:44 | Link to Comment Never One Roach
Never One Roach's picture

Some of the Largest Bagholders of Knight:

http://finance.yahoo.com/q/mh?s=KCG+Major+Holders

Thu, 08/02/2012 - 12:51 | Link to Comment Miss Expectations
Miss Expectations's picture

FIDELITY SMALL CAP DISCOVERY FUND apparently knows what it's doing.

Thu, 08/02/2012 - 12:48 | Link to Comment Mercury
Mercury's picture

Will it happen? Maybe. Although we doubt it - why pay for equity value when one can pick up the functioning assets in a Chapter 363 asset sale which also sticks the creditors with all the crappy assets? Just like Barclays did with Lehman for millipennies on the dollar.

 Résumé flow may be the best tell here...

Thu, 08/02/2012 - 12:48 | Link to Comment HD
HD's picture

At least they are consistent with their HFT business model...nanosecond bankruptcy.

Thu, 08/02/2012 - 13:02 | Link to Comment Jlmadyson
Jlmadyson's picture

Blah blah blah, bailout, AIG, Lehman Bros,, Bear Sterns, Margin Calls, Fannie, Freddie, CorZine.

Just another day in Wonderland.

Thu, 08/02/2012 - 12:50 | Link to Comment Call me Ishmael
Call me Ishmael's picture

Didn't these guys watch Office Space? The penny and nickle skimming algo goes ape shit and the people that made it are lucky to get jobs digging ditches.

Thu, 08/02/2012 - 13:16 | Link to Comment seamus3500
seamus3500's picture

or drinking margaritas on the beach with too much salt

Thu, 08/02/2012 - 12:50 | Link to Comment JLee2027
JLee2027's picture

7.5 Billlion in cash on their balance sheet. What about that? Is it really not there?

Thu, 08/02/2012 - 12:51 | Link to Comment alien-IQ
alien-IQ's picture

hurling a hail mary to an empty field. great strategy. What's next? blaming the shorts?

Thu, 08/02/2012 - 12:51 | Link to Comment eclectic syncretist
eclectic syncretist's picture

A market maker being run by a HFT operation????!!!!

 

Good thing I faded that trade the NY Fed promoted for the days immediately preceding through the day after a Fed meeting.  Bastards fleeced the sheep for nearly 3% on this trip.

http://www.newyorkfed.org/research/staff_reports/sr512.pdf

Thu, 08/02/2012 - 12:56 | Link to Comment ArrestBobRubin
ArrestBobRubin's picture

Knight had complained publically about the blatant Facebook scam. Look what's happened. First ruined via a "glitch", then made to disapperar via a "merger". A very odd sequence of events indeed.

Critical Lessons From The Facebook Scam: A Blast From The Past

Thu, 08/02/2012 - 13:03 | Link to Comment ArsoN
ArsoN's picture

nothing like a little sub rosa action to keep the house of cards from collapsing for another week or two.  

Thu, 08/02/2012 - 13:11 | Link to Comment John Law Lives
John Law Lives's picture

Could it be a desperate attempt to keep the stock price afloat whilst insiders dump...

Thu, 08/02/2012 - 13:17 | Link to Comment Seasmoke
Seasmoke's picture

surely Jamie smells blood in the water

Thu, 08/02/2012 - 13:34 | Link to Comment Meesohaawnee
Meesohaawnee's picture

I hear there are some programmers looking for work?

Thu, 08/02/2012 - 13:45 | Link to Comment Dr. Engali
Dr. Engali's picture

Knight Capital is dead. Just need Mr. market to pull the final plug.

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